S&P Global Market Intelligence’s review of 2025 financial results for China’s largest life insurers reports higher total returns on investment, following a regulatory directive to direct more new premiums into domestic equities and set against a period of expected expansion in the life market.
According to S&P Global Market Intelligence, China Life Insurance Co. Ltd., Ping An Insurance (Group) Co. of China Ltd., and New China Life Insurance Co. Ltd. all reported higher total investment returns in 2025 after regulators in February 2025 encouraged major state-owned insurers to invest 30% of newly added premiums in yuan-denominated equities. After the guidance, the three groups increased their equity exposures during the first half of 2025, which was reflected in full-year results. Among the three, New China Life recorded the largest percentage increase in total return on investment, with investment income rising 35% to 107.02 billion Chinese yuan in 2025 from 79.43 billion yuan in 2024.
Read next: China Life posts 44% profit rise
China Life’s total investment return increased 25% year over year to 386.64 billion yuan in 2025, compared with 308.15 billion yuan in 2024. Ping An Insurance reported a 7% increase in investment returns, to 308.49 billion yuan in 2025 from 288.12 billion yuan in 2024. These investment results coincided with higher operating profit for all three insurers. China Life’s operating profit rose to 186.12 billion yuan in 2025 from 119.77 billion yuan in 2024, a 55% increase. New China Life’s operating profit increased 29% to 41.14 billion yuan from 31.85 billion yuan, while Ping An Insurance’s operating profit grew 11% to 263.69 billion yuan from 236.79 billion yuan.
The investment outcomes highlighted by S&P are taking place in a prolonged low interest rate environment that is shaping both asset allocation and product structures for Chinese life insurers. In a research note, S&P Global Ratings analyst WenWen Chen estimated that the sector’s average return on assets will likely remain in the 1% to 1.5% range over the next two years, given current rate conditions. Chen said that lower yields on fixed income instruments are likely to keep pushing insurers toward higher allocations to equities, increasing exposure to market volatility. Chen also identified product design as a key approach to managing investment and liability risk. A greater focus on policies with floating returns and adjustable, unguaranteed dividends could allow insurers to share investment risk with policyholders and reduce liability costs, which may support reported results under IFRS 17.
On an IFRS 17 basis, the three groups reported different trends in insurance service results, with China Life showing the largest year-over-year change. China Life’s insurance service result rose to 64.90 billion yuan in 2025 from 28.00 billion yuan in 2024. The change reflected a reduction in insurance service expenses to 148.74 billion yuan from 180.54 billion yuan and an increase in insurance service revenue to 214.14 billion yuan from 208.16 billion yuan.
Ping An Insurance reported insurance service revenue of 559.50 billion yuan in 2025, up from 551.19 billion yuan in 2024. Its insurance service expense increased to 453.27 billion yuan from 449.10 billion yuan, resulting in an insurance service result of 101.17 billion yuan, compared with 98.48 billion yuan a year earlier. New China Life posted insurance service revenue of 50.30 billion yuan in 2025, compared with 47.81 billion yuan in 2024. Insurance service expense edged up to 31.75 billion yuan from 31.58 billion yuan, taking its insurance service result to 18.13 billion yuan from 15.90 billion yuan. These figures indicate shifts in underwriting performance and expense management under IFRS 17, alongside the investment-driven changes outlined in S&P’s analysis.
While S&P’s work focuses on recent insurer performance, longer-term projections from GlobalData indicate that China’s life insurance market is expected to grow through 2030, supported by demographics, policy initiatives, and product adjustments. GlobalData forecasts that China’s life insurance market will increase from 4.9 trillion yuan in direct written premiums (DWP) in 2026 to 6.6 trillion yuan in 2030, representing a compound annual growth rate of 7.9%. The firm’s Global Insurance Database suggests that life premiums are expected to grow 11% in 2025, driven by distribution channel reforms, product redesign following benchmark rate cuts, and greater use of digital tools in sales and claims.
China’s aging profile is a central factor behind the projections. The World Health Organization identifies China as one of the countries with the fastest aging population, while the National Bureau of Statistics expects people aged 60 and above to account for 22% of the population in 2025 and those 65 and older to make up around 15%. This has increased demand for whole life policies, which GlobalData estimates represent about 81% of life DWP in 2025, including business from high-net-worth individuals who use life insurance for inheritance and estate planning.
